I am a University Professor at Syracuse, served as president of the Kauffman Foundation for the last ten years, and am the author of Better Capitalism (Yale, 2012). I teach a course “Failed Cities/Fast Cities” in the university’s Renee Crown Honors College.

11/19/2012 @ 9:25AM1,850 views

Global Entrepreneurship Week: Three Big Lessons For America

It is hard to believe that it was only five years ago that the first Global Entrepreneurship Week was held. Last week gives evidence of the tremendous enthusiasm for the idea that Prime Minister Gordon Brown and I kicked off in 2007 with 38 countries participating. One hundred thirty nations sponsored an enormous array of events all aimed at helping young men and women around the world consider their future as potential creators of new businesses, and as contributors to the economic well being of their countrymen.

The success of the week can be measured in many ways. It is estimated that over 15 million youngsters participated in tens of thousands of events and competitions. The website http://www.unleashingideas.org/ provides a marvelous sense of the scope of activities. Many young people had their first glimpse of a possible new future for themselves, others had their first conversation with an aspiring entrepreneur in another country, and still others visited a company, indeed, a start-up company for the first time.

Global Entrepreneurship Week holds important lessons for Americans in particular. The first is simple but is worth reflecting on. Just a few years ago GEW was nothing more than an idea. It grew from a conversation between two people who were passionate about helping their countries see the importance of entrepreneurs to their respective nation’s economic growth.

GEW, for all its enormous impact, was like every new business — once just an idea. GEW was itself a start-up! Like every business it is the objectification of an idea, a good one because it passed the most important of market tests – it grew and grew; becoming a big scale global event! I am sure that next year what was once an idea will be an even bigger success; perhaps a dozen more countries will join intent on spreading the message that entrepreneurs are important to economic growth. The lesson is that a few people can bring forth enormous good in very little time with the right idea.

Second, the underlying success of the idea was that America was already known as the home of more entrepreneurs per capita than any other place save Israel. Long before the Kauffman Foundation had taken up entrepreneurship in a serious way, countries interested in economic growth had been studying America’s success. It was Kauffman’s economic research that provided the evidence that the American record of growth was largely the doing of entrepreneurs. As other countries studied America they began to see that having more successful entrepreneurs was the best path to economic growth. GEW’s enormous success has been related to the history of America’s congenial relationship with her entrepreneurs. Both China and India have achieved monumental gains in reducing poverty because of their embrace of entrepreneurship! It is a gift to the world that America should be proud of.

Third, we have to worry in America that even as we export the message and promise of entrepreneurship and its relationship to growth – with all the gains it holds for improving human welfare - that we don’t lose sight of just how critical growth is to our own future and well being. America cannot become a state-fair barker for a product we don’t use at home! After four long years of very little growth we are, in the wake of a presidential election, about to argue about more taxes and regulations! Let’s just look at the precipitous fall off in new start-ups in the last three years and ask ourselves if we really believe that economic growth is a good thing?

If we stand by not worried that nearly a third fewer people are taking the risks of starting a new business, how can we possibly expect our economy to grow? Every survey of entrepreneurs, would-be entrepreneurs, and small business owners tells us the same thing. Looking into a future where the federal government says it loves new businesses but acts as if more regulations and higher taxes are what’s needed presents too much cognitive dissonance for most entrepreneurs to start a business or expand an existing one.

Global Entrepreneurship Week is the essence of what America is supposed to do. We model behavior for others. We take the message of American success to the world. We say “Make your economy like ours and the welfare of your peoples will increase.” In specific, the American message in GEW is “free the entrepreneurial potential of the world and we will all be better off.” But, America must take care that our own economy is growing because more not fewer people are starting businesses lest the all-important message that more entrepreneurs equals more growth is ignored because it is looks hollow at home.

Carl Schramm is University Professor at Syracuse and served as president of the Kauffman Foundation for the last ten years.

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